How Much Commission Will You Pay with Investment Real Estate Sales?

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How Much Commission Will You Pay with Investment Real Estate Sales?

If you’ve ever sold a primary residence and used a real estate agent to help you get the deal done, then it is likely that you paid somewhere in the neighborhood of 5 to 7 percent for the agent’s commission.

How Much Commission Will You Pay with Investment Real Estate Sales?Although that may seem high, there is a long list of services that the agent will – or should – provide, such as marketing the property, holding open houses, and working with the potential buyer in price negotiations. The agent may also set up the inspections that are required.

But in the investment real estate world, there are some things that work differently. So, will you still pay the same amount of agent commission?

The answer is that depends.

For instance, on sales of single family properties, the commission percentage will oftentimes be in the same 5 to 7 percent range as it is with other residential real estate sales. However, if you are planning to sell a larger, and more expensive, property, then it is likely that you will see the commission range drop as the price of the property goes up.

While the exact percentages are generally based on the area, as well as the individual agent, in larger metro areas like Orlando, you may see commission rates in the range of 4 to 5 percent on property that’s listed up to $4 million. On property that is priced higher than that, it may even be possible to see the commission percent drop a bit further, in the range of 2 to 4 percent.

Depending on how much equity you have in your current properties, it may be beneficial to hang on to them as rentals rather than sell. This being the case, you don’t necessarily have to spend the time and the effort that it takes maintaining your real estate investments.

Hiring an experienced property manager can provide you with more time to pursue other things, while at the same time still receiving monthly income. For more information, give us a call, and we’ll walk you through your options.

2017-07-11T20:09:03+00:00 By |Advice, Investing|

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